Aside from the dreadful impact on so many people’s lives, the impact on companies during an economic downturn follows a similar pattern: general cost cutting, a reduction in marketing investment, recruitment freezes, rising unemployment and a curtailing of research and development.
As a result, digital marketing activities often come under heavy scrutiny within most types of companies. However, when considering these potential cuts, it’s very important to be aware of the unique opportunities that may present themselves during a recession, and how digital marketing can potentially be used to harness these for significant benefits.
Mark Ritson, a leading brand consultant, published an article in Marketing Week leading with the concept that marketers can in fact benefit from a recession. The answer? Be prepared to think long-term.
“It may seem like a paradox, but recessionary periods actually provide fertile grounds for marketers to grow their brand’s market share if they’re prepared to think long-term.”(M. Riston, 2020, Marketing Week)
So what is the potential of digital marketing during an economic downturn?
Here we are going to take the concept that marketers can grow their brand’s market share during an economic downturn, and I’ll share the 5 key reasons to continue investing across your digital marketing mix including: SEO, content marketing, paid media, social media and web analytics. Whilst also sharing some tips on how to persuade other stakeholders to sign off on these activities, where helpful.
Currently, the UK and countries across the world are battling with the COVID-19 pandemic that is leading to an economic crisis of proportions not seen since the Great Depression.
In the UK alone, the economy will have shrunk by a record 35% by June 2020 (BBC, 2020).
Unfortunately, there is currently no end in sight to the economic nightmare unfolding due to COVID-19. So unsurprisingly, many companies are reducing or pausing their marketing campaigns, in line with trends witnessed during previous recessions.
However, due to the big and sudden changes in both user and competitor behaviours, now is potentially a great time for most companies to review their digital marketing strategies, as it has never been more important to make the right decisions quickly.
SEO is a long-term investment for businesses, and this is the case whether the economy is booming or in recession.
If you pause or reduce SEO activity during an economic downturn, or wait until the economy has recovered, then you will miss out on the opportunity of benefiting from significant increases in organic traffic and revenue in the long-term.
For instance, Google updates its core algorithm each day to improve their search results (Google Webmaster Central Blog, 2019) and if you have an effective SEO strategy in place, this will lead to incremental improvements to your SEO performance over the long-term.
These core algorithm updates result in keyword ranking fluctuations that enable your webpages (if optimised correctly) to increase in ranking and therefore generate more organic traffic and hopefully increase conversions. Search engines reevaluate their search results using algorithms based on over 200+ ranking factors. This requires continuous SEO efforts to improve a company’s performance in line with their overall SEO strategy.
To implement an effective SEO strategy, you need to undertake SEO research and strategy development to establish a roadmap for growth. This would include: keyword research, user intent analysis, competitor gap analysis, technical audits, content audits and backlink analysis. It takes time, it could take 2 months to complete before implementation in months 2 to 3.
In this scenario, you’d likely benefit from SEO after 3 – 6 months by which time the economic downturn could have bounced back, and your business will be more competitive to win ‘share of search’.
Investing in SEO now will lead to keyword rankings improvements in the near future, meaning you will have greater visibility when demand surges post economic downturn, resulting in the potential for huge organic growth for your business.
SEO requires no additional media budget, unlike PPC, so this could present itself as an attractive option should you have to cut your media budgets.
Building your long-term SEO infrastructure during an economic downturn should be a number one priority for businesses, as it will help you to:
In summary, by investing in SEO during an economic downturn when your competitors may not be, you will have a very unique opportunity to significantly increase your market share from all types of organic search results. This is likely to then start yielding very significant benefits as soon as the economy starts to recover.
This particular recovery from the COVID-19 pandemic could be sooner rather than later, given the immediate boost that the economy is likely to receive as soon as the current lockdown ends.
Marketing Week and Econsultancy recently surveyed around 900 UK brand marketers, in relation to the current COVID-19 crisis. The full study can be seen here [ (S. Vizard, 2020, Marketing Week) ] and some of the key insights were as follows:
More than half (55%) are delaying or reviewing campaigns 60% are delaying or reviewing their budget commitments.
This survey is specific to the COVID-19 pandemic, but it does resemble the familiar historical trend of companies cutting their budgets for marketers and advertisers during an economic downturn.
To showcase this, Mark Riston looked to Roland Vaile in his article “The best marketers will be upping, not cutting, their budget”. Roland Vaile was a well respected Harvard educated marketer who built his reputation in the 1920s. Vaile is famous for his study into the fortunes of 250 firms during the 1920 – 1924 recession. (R.S. Vaile, 1981, Journal of Marketing History)
Vaile tracked the advertising investment and corresponding annual revenues of these firms during the recession. He divided each firm into three groups: firms which did no advertising, firms which increased their advertising, and firms which decreased their advertising.
The study demonstrated that after 4 years, those firms which increased advertising during a recession generated:
The study is almost a century old, however its lessons are still poignant today. With digital paid media advertising you have access to a wealth of performance data to optimise your campaigns, enabling you to identify which keyword segments, affinity audiences and messaging that delivers the best ROI during an economic downturn.
As most users will now be starting to behave very differently, it has arguably never been more important to test and learn various different approaches, in order to see how strategies may need to be adapted for the new type of economy that we are about to enter.
That’s because those who restart with their unadjusted previous campaigns in the near future, are likely to spend a lot of money on campaigns that are no longer optimal before they realise the need to change their strategies.
Paid media advertising can win “share of mind” with your consumers as competition drops for audience affinity targeting, typically leading to an increase in long-term sales, share of market and profits.
So, to summarise, paid media advertising has the opportunity to deliver significant long-term benefits during an economic downturn, for the following reasons:
During a recession, a crisis, or times of uncertainty, your audience is more likely to be anxious about the future, seeking answers and information to questions that your brand can answer.
Traditional media outlets are also in decline, as many are culling their staff and pivoting their business model to focus on digital, which has only been accelerated as a result of the COVID-19 pandemic and likely recession.
This presents an opportunity for your brand to act as a publisher to fill information gaps with content that builds trust and credibility through educating and inspiring your audience.
Your key focus should be on building your subscriber base through content marketing, instead of trying to sell your products or services.
A recent study shows that 68% of leading content marketers use content marketing to nurture subscribers, audiences and leads, whilst “88% of top content marketing performers put audience needs over their sales messages.” (S. Stahl, 2019, CMI)
According to the same CMI study, the most cited content marketing goals were:
By focusing on these goals, content marketing has the potential to build leads within the early stages of your pipeline, enabling you to nurture leads over time.
Scott Edinger, founder of Edinger Consulting and leadership consultant, suggests that during an economic downturn businesses should focus on the early stages of the pipeline rather than obsessing over late-stage negotiations.
“Myopically focusing on late-stage revenue also results in missed opportunities during the early stages of the sales process. It’s here where you have the greatest potential for strengthening the business and minimizing the effects of a recession.” (S. Edinger, Harvard Business Review, 2020)
You should invest the time and resources into developing a content strategy that captures potential customers during the early stages of the sales process by offering educational or inspirational content relevant to your niche.
An example of a brand that has responded well to the COVID-19 pandemic and its impact is Destination British Columbia with their Explore BC… Later campaign. They company have published a lead article on their blog with their official response and clearly outlining what their audience needs to know. They have also repurposed their video content in a montage that engages their audience, but have adapted their message “Super Natural British Columbia” to “Explore BC… Later”.
In summary, content marketing can be the hero of your digital marketing mix during an economic downturn or crisis. It should act as the foundation of your digital strategy.
Content marketing will help you to:
Social media has the potential to connect with your audiences like no other digital channel. It’s the most personal and intimate channel in your arsenal, making it a perfect choice to build meaningful relationships that help your audience during an economic downturn.
You should use social media as an effective tool for leading your crisis communication strategy, supporting PR initiatives and delivering content to your audience when and where they will see it.
During a crisis like the COVID-19 pandemic, this becomes exponentially more crucial to staying connected to your current and future customers.
Social listening, the process of using technology to analyse social conversations, will enable you to keep your finger on the pulse of your audience’s pain points. During a crisis or economic downturn these concerns can magnify and warp entirely.
By listening to the social conversations being had by your audience, you can use that to inform everything from your social calendar, content strategy, brand positioning, services alignment and product development.
This is especially important during an economic downturn as consumer behaviour can shift significantly and you will be presented with opportunities to fill the information gaps.
We were monitoring the social conversation around COVID-19 & property related keywords that can broadly be segregated into 5 topics:
Identifying these sub-topic conversations, the sentiment around them as well as influencers helps to define a strategy by understanding your audience’s concerns, which in turn informs your social and content calendars to address these.
Social media offers so much potential for brands during an economic downturn or crisis, including:
A phenomenon of the COVID-19 pandemic has been how the daily habits and routines of people across the world have changed due to government imposed lockdowns. This has a profound impact on online user behaviour and purchase trends across so many industries.
As a result, many businesses are experiencing drastic changes in how users interact with their website. This presents challenges but also significant opportunities to gather intelligence on your customers and how your website can be optimised. Overall, it’s crucial to be monitoring the performance of your digital channels during volatile periods.
Agile businesses that can learn from their web analytics and pivot their digital marketing strategy accordingly will endure and are likely to come out the other side stronger.
Web analytics can provide you with a number of benefits during an economic downturn or crisis, including:
We understand that it can be daunting for most businesses during these challenging times. Therefore, we are offering a free opportunity analysis for companies looking to update their digital marketing strategies for 2020.